Russia Re-Putined

Rachel Marsden

3/6/2012 2:24:00 PM - Rachel Marsden

So Russian Prime Minister Vladimir Putin has just been re-presidented for at least another six years, during which we can all watch his newly tucked eyes migrate back to where they used to be. And as surely as a pound dog comes with fleas, this election came with "irregularities" -- cloaked in "democracy," as Russian powers like to do it.

For instance, there were 200,000 webcams to monitor the polling stations, but all fed directly into the Kremlin. There were also candidates other than Putin. See if you can name one. If you can't, blame the Russian authorities, who refused to allow anyone competitive on the ballot -- something into which President Medvedev (soon to be re-prime ministered) is demanding a Ministry of Justice investigation. This Russian electoral exercise reminds me of the fun I used to have as a child, putting a doll in each hand and making up the voice for each one as they argued with each other -- before getting tired of the charade and throwing both into the back of my much favored Tonka dump truck.

The surprising story of this election is one that's been largely overlooked. I'm less moved by Putin winning a third presidential term than I am by the fact that Gennady Zyuganov, who describes himself as a "Communist" to the point where he thinks that Putin obviously isn't one, would score as much as 17 percent of the vote. Granted, he's fed up with power being in the hands of a select few and sounds like a Russian 99 percenter, but he was hardly a "Nyet to The Man" candidate, having called for the "re-Stalinization" of Russia.

Wealth distribution without productivity is a recipe for economic collapse. The Russian oligarchs are tasked with investing Kremlin money worldwide, which at least carries some risk. The idea of just handing it out in the absence of any responsibility is dangerous. Nor would it be morally fair for Russians in the business and industrial sectors to work to support those who do nothing. If there is to be a more equitable distribution of Russian GDP, then it ought to be earned.

This might be what Putin was getting at when he recently announced huge investment in the Russian military-industrial sector, with a tripling of military members' pay. At least they'll be working for it, developing their talents for future application. In doing so, they'll enjoy a better standard of living, thereby curtailing the demographic winter and lifespan/emigration problem to which many experts feel Russia is doomed.

Sure, it's still a Communist system, but this is a strategy that, at its core, acknowledges a very capitalist principle: the association between work and earnings, and the linking of one's future opportunities to effort. A great many Westerners have been able to use the military and its skills-based training as a springboard to a better life.

The biggest domestic challenge that Putin will have to face is the fact that middle-class Russia still largely votes with its feet. Members of the middle class don't stick around waiting for the next electoral exercise; a lot of them just take off and make a life for themselves elsewhere. The booming Russian energy sector has brought many of them back, along with new foreign talent, but Russia needs a real domestic economy of its own that retains talent.

Moreover, foreign investors are still freaked out by the unpredictability of doing business in Russia, and that will always put Russia at a disadvantage, even vis-à-vis its fellow BRICS developing countries (Brazil, India, China and South Africa). All the due diligence in the world can't negate a sudden targeted move by the Kremlin against a company or sector. Russian leadership has a tendency to alienate even its close friends, shutting off gas flow in response to a wind shift in the political climate. It's this unpredictable schizophrenia that hurts Russia and its international competitiveness. Maybe once Russian leadership figures this out, it can worry less about making unsavory friends -- like those currently running Syria and Iran.

If I were Putin, I'd want to put Syria's Bashar al-Assad and Iran's Mahmoud Ahmadinejad in the back of a Tonka dump truck headed for Siberia. Come on, Vlad -- you know you want to. Sometimes the worst part of doing business is dealing with the jerk clients.

P.S.: Love the new face, Vlad. It makes me want to go jump on a mini-trampoline in the backyard.